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JKL Enterprises is considering a project with the following expected cash flows: Year Cash Flow (Rs.) 0 -1,80,000 1 50,000 2 60,000 3 70,000 4

JKL Enterprises is considering a project with the following expected cash flows:

Year

Cash Flow (Rs.)

0

-1,80,000

1

50,000

2

60,000

3

70,000

4

55,000

5

50,000

  • Depreciation: 12% on original cost
  • Tax rate: 25%

Required:

  1. Calculate Payback Period (PBP) and ARR.
  2. Compute NPV and NPV Index with a 7% discount rate.
  3. Calculate IRR.
  4. Determine the profitability index.

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